In the age of plastic and electronic bill pay...who writes checks?
Is the term “checking account” itself a stumbling block to engaging young adults? Yeah, "free checking” is all well and good to advertise, but many online and card wielding folks might think, well, I don’t write checks so who cares?
Seriously, long term strategy: at what point is the term “checking account” rendered meaningless? I write probably 1 or 2 checks every few months – there is going to come a time when a rebranding is in order.
What does that look like and how can CUs own it?
Monday, February 18, 2008
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4 comments:
Good point.
I posed the same question to the 30 under 30 group and Christopher Danvers threw out the term "spending accounts," which I like a lot.
Why?
Just in terms of definition – it also works well in tandem with a “savings account” in terms of balance: You have a spending account for everyday spending, bills and activities…and then your savings account for, um, saving.
Pretty simple and you make it easier for the consumer who might not quite understand what’s involved in a “checking” account.
And with being called a "spending account" it would sound preposterous to most users for a FI to charge you fees to spend your own money.
However, I don't think the "checking account" term is what CUs need to worry about. What they should be more concerned about is trying to explain what a "share draft" account is, as that's the lingo I usually hear from CUs.
I just stood there with a puzzled look on my face when my local CU representative tried to tell me about my new "share draft" account. It sounds more like something you would do with a good friend at a bar than relating to finances.
This is a conversation that has been happening a lot this year.
No offense to Chris but I proposed a "Payment Account" as these accounts are not only hooked up to debit cards but also PayPal and automatic payment systems.
As for Mike's comment - I don't think it is unreasonable to charge a fee to process your automatic payments or payments using a variety of connected systems.
For example, when we are using our cell phones for point of purchase payments (I already do this to buy my morning coffee and bagel using text messaging and automatic drafts from my checking account). I can see a small fee being applied for this convenience. It is just another way for me to pay without having to carry cash.
I think checking is on it's last legs. I really do think that for the individual, check use will peter out over the next 10 years. Then banks and CUs will have to charge just to maintain the system, and that will be the death spike.
But as long as the guy who mows my lawn wants checks, I will keep writing them. But that is the only check I write every month.
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